The dollar strengthened against the pound yesterday due to worries over the bleak global economic outlook, which resulted in a decrease in investors’ appetite for riskier currencies. There was mixed data released in the US yesterday, with the announcement that US retail sales were up by 1% in January while Labor Department data revealed the number of unemployment benefit claimants rose for the fourth week in a row, up to 4.81m in the week to 31 January from 4.8m the week before.
Investors are now waiting to find out the outcome of the US $789 billion stimulus plan, which is expected to be put to a vote in both the House and the Senate today. The pound remained weak against most of the major currencies following the Bank of England’s announcement that they may make use of quantitative easing in order to revive the economy.
There are no significant announcements taking place in the US or UK today.
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